Florida construction liens: how homeowners avoid paying twice

Why a homeowner can end up paying twice

Under section 713.015 of the Florida Statutes, any direct contract greater than $2,500 between an owner and a contractor for work on a home of up to four units must include a lien-law notice, in capitalized bold type of at least 12 points, on the front page or on a separate page that you sign and date. The notice says that if your contractor or a subcontractor fails to pay subcontractors, sub-subcontractors, or material suppliers, those people may look to your property for payment, even if you have already paid your contractor in full.

The mechanics are simple. Your money goes to the contractor, and the contractor pays the supplier, the distributor, or the crew it subcontracted. If one of those payments does not happen, the unpaid company can have lien rights against the home it improved. The required notice itself warns that if a lien is filed, a property could be sold against the owner's will to pay for that labor or material.

Jobs with a direct contract price of $2,500 or less are exempt from most of this part of the law under section 713.02(5). Everything below is about larger jobs, which covers most roof replacements, impact-window projects, and HVAC replacements.

The notice of commencement: record it, post it, watch the date

Before work begins on a job over $2,500, section 713.13 requires the owner, or the owner's authorized agent, to record a notice of commencement with the county clerk and post a certified copy (or a notarized statement that it was filed, along with a copy) at the job site. The statute says the owner must sign the notice and no one else may sign in the owner's place, so expect to sign it yourself even if someone else fills in the form.

Two dates on it matter. If the work does not actually begin within 90 days after the notice is recorded, the notice is void. And unless it states a different date, it expires 1 year after recording. The warning printed on the statutory form says payments made after it expires are improper payments that can result in your paying twice, so a job that could run past that date needs the notice amended to extend it while it is still in effect.

The same form warns that the notice must be recorded and posted on the site before the first inspection. Separately, section 713.135 says that when the direct contract is greater than $5,000, the permit applicant must file a copy with the permit office before the first inspection, and later inspections cannot be approved until it is on file. That permit-office rule does not apply to a contract to repair or replace an existing heating or air-conditioning system for less than $15,000.

A notice to owner is a heads-up, not a lien

Subcontractors and suppliers you did not hire directly generally must serve you a notice to owner before they can later claim a lien. Section 713.06 requires it before they start, or no later than 45 days after they start furnishing labor, services, or materials, and in any event before your final payment once the contractor has given you a final payment affidavit. Laborers are the exception and do not have to send one.

Receiving one on a larger job is normal and does not mean anything has gone wrong. The statute says the notice is not a lien, cloud, or encumbrance on your property. Treat each one as an entry on a list: every notice to owner you receive names a company whose payment you want released before you pay the contractor again.

Keep every notice with your contract. The law puts you under no obligation to a lienor, other than a laborer, who had not served you a notice to owner at the time you made a payment, and a failure to serve the notice on time is a complete defense to enforcement of that company's lien.

Collect a release before every payment

The notice Florida requires in your contract spells out the protection: stipulate in the contract that before any payment is made, the contractor must give you a written release of lien from any person or company that has sent you a notice to owner. Putting that in the payment terms before you sign is far easier than asking for it once a payment is already late.

Section 713.20 includes standard forms for a waiver and release of lien upon progress payment and upon final payment. A progress release covers work furnished through a stated date, so check that the date and the amount line up with the payment you are making. A company may make its release conditional on its check being paid; if no payment bond protects you, the statute lets you withhold the amount of that unpaid check from your payment to the contractor until the condition is satisfied.

A release cannot sign away rights ahead of time. Under section 713.20(2), a right to claim a lien may not be waived in advance, a lien right can be waived only to the extent of labor, services, or materials already furnished, and an advance waiver is unenforceable. A release protects you for work already done, which is why you collect one with each payment rather than once at the start.

Hold the final payment for the final payment affidavit

When the final payment comes due, section 713.06 requires the contractor to give you a final payment affidavit: a sworn statement that every lienor who served a notice to owner has been paid in full, or a list of each one who has not and the amount owed. The statute tells the owner to retain the final payment until that affidavit has been furnished, and a contractor has no lien or right of action against the owner for the work while in default for not providing it.

You can generally rely on the affidavit when making the final payment, unless a company that served you a notice to owner is missing from it. If the affidavit lists unpaid bills and the balance you still owe is enough to cover them, the law lets you pay those companies directly after giving the contractor at least 10 days' written notice, and deduct what you paid from the balance due.

The Florida Attorney General puts the same idea plainly: insist on releases of any liens from all subcontractors before making final payments, and do not sign a certificate of completion or make a final payment until you are satisfied with the work performed.

If a claim of lien shows up anyway

A claim of lien is recorded with the county clerk and must be served on the owner. Section 713.08 says it can be recorded no later than 90 days after that company's final furnishing of labor, services, or materials to the job. The warning printed on the statutory form says that unless the owner takes action to shorten the time period, the lien may remain valid for one year from recording, and it expires after that unless legal proceedings to foreclose or discharge it have begun.

Do not ignore one. Gather the contract, every notice to owner, every release, your payment records, and the final payment affidavit, then speak with a Florida construction attorney; the notice required in residential contracts itself says the lien law is complex and recommends consulting one. It also helps to know what the law expects of the money you paid: section 713.345 requires anyone who receives a payment for improving real property to apply it to amounts then due for labor, services, and materials already furnished, and knowingly failing to do so is the crime of misapplication of construction funds.